AI and technology preventing plug revenue leaks from returns claims

By OEM Update Editorial June 19, 2024 7:03 pm IST

A top AC manufacturer deploys Al and technology to prevent revenue leakages from returns claims while boosting efficiency and profitability in the industry.

Equipment makers find management to be a complex undertaking, especially in the appliance industry. Without intelligent item condition assessment and claim validation at the source, OEMs are confronted with a deluge of invalid returns and conflicts over claims with dealers and retailers. Logistics and service teams under pressure might grant invalid or fake claims to lighten their workload. It also dodges the pressure from the sales team, which does not want to jeopardise its connection with dealers and retailers. Revenue leaks are, therefore, typical in the sector.

Adopting technology to tighten the claim initiation is the solution to this issue. Resolution and item condition assessment processes save manual hours while preventing revenue leakages. 

Challenge

A leading omnichannel OEM with an omnichannel sales network that includes more than 400 dealers, 100 retail outlets, and e-commerce platforms was facing challenges with validating all returns claims (from dealers/retailers/customers) at the origin and tracking the returned items throughout their lifecycle. This was primarily due to a lack of transparency and a unified platform. 

As a result, the service and logistics teams were grappling with unwarranted returns and claim disputes. This was because of mismatched items in each return. While this was traditionally written off as a “cost of doing business,” the OEM realised it was eating into its already thin margins. Additionally, the approval cycle was 30-45 days long due to a lack of alerts and reminders, resulting in a bad experience for dealers and retailers.

Solution

Blubirch’s returns management solutions allowed dealers and retailers to use AI-based grading. It was done to capture the condition of in-transit damaged and mismatched items and raise return claims immediately. The OEM validated the return claims through in-application images captured by retailers/dealers and other claim details. The solution also enabled tracking of individual returned items through unique serialisation from claim initiation to final settlement.

The process of raising claims becomes intuitive and hassle-free. Dealers can raise return claims in real time with auditable images, time stamps, return reasons, and geo-location tags. They can also resolve claims quickly without waiting for days. Both parties can track the physical receipt of returned items in real-time, eliminating the need for constant follow-ups. 

By configuring alerts and escalations using Blubirch, the client could promptly action claims, reducing the claim approval TAT to 10 days from the erstwhile 30-45 days. Using Blubirch’s alert and escalation settings, the client processed claims faster and cut approval time from 30-45 days to just ten days.